Written byEFTPOS means electronic funds transfer at point of sale: paying by card at a terminal so the money moves straight from the customer's bank account to the business.
Also known as: electronic funds transfer at point of sale, EFTPOS terminal, eftpos network, EFTPOS machine
Key points
- The terminal accepts debit and credit cards by tap, insert or swipe, and increasingly phones and watches.
- Lower-case eftpos is also the name of Australia's domestic debit card network, owned by Australian Payments Plus, which runs alongside Visa and Mastercard.
- Merchants pay fees on each transaction; routing debit payments through the eftpos network (least-cost routing) is often the cheaper option.
- For a small business, EFTPOS takings are the daily cashflow, so a terminal outage or a settlement delay shows up straight away.
How an EFTPOS payment works
The customer presents a card or phone, the terminal sends the details to the merchant's payment provider, the transaction is routed across a card network to the bank that issued the card, and an approval comes back in a second or two. The money is then settled into the merchant's account, usually the same or next business day depending on the provider.
Debit transactions draw on the customer's own money; credit transactions draw on a credit limit. Both run through the same terminal. Surcharging, where a business passes its card costs on to the customer, is on the way out: following the RBA's 2026 review, the card networks are removing surcharges on eftpos, Visa, Mastercard and Amex payments from 1 October 2026.
eftpos the network versus EFTPOS the terminal
The word does double duty. In capitals it is the machine on the counter. In lower case it is eftpos, the Australian debit network that competes with the international Visa and Mastercard debit schemes. Most Australian debit cards are dual-network: they carry an eftpos logo and an international logo and can be processed by either.
A tap defaults to the international network unless the merchant has turned on least-cost routing, also called merchant choice routing, which sends eligible debit transactions down whichever network costs less to accept. For many businesses that is eftpos, and the RBA has pushed providers to make the option available and easy to switch on.
EFTPOS for a small business
Terminals come from banks and from payment fintechs, on a rental plus per-transaction basis or a flat percentage. The things worth comparing are the effective cost per hundred dollars taken, how quickly funds settle, whether least-cost routing is on by default, and what happens when the internet drops: a terminal with a mobile SIM or an offline mode keeps the shop trading.
EFTPOS records also matter for finance. Merchant statements are hard evidence of turnover, and a merchant cash advance is repaid as a slice of daily card takings, which suits cafes, salons and retailers whose income arrives through the terminal. Settlements that reconcile cleanly against the bank statement mean the figures a lender sees line up.
Example
A Brisbane bakery takes most of its sales by card before 10am. When a network outage knocks out its internet for a morning, the terminal's mobile SIM keeps payments running and the day's takings settle as normal the next morning. Reviewing the bill afterwards, the owner notices that tap payments are all going through the international networks, asks her provider to switch on least-cost routing, and watches the monthly card fees drop without changing anything the customers see at the counter.
Not to be confused with
- Direct debit
- a direct debit is an authority for a business to pull regular payments from an account, not a card payment at the point of sale
- Buy now, pay later (BNPL)
- buy now pay later is a credit arrangement offered at checkout, while EFTPOS moves the customer's own money at the time of sale
Frequently asked questions
What is the difference between EFTPOS and a credit card payment?
The terminal is the same; the money is not. An EFTPOS debit payment takes funds straight from the customer's bank account. A credit card payment draws on a credit limit the customer repays later. For the merchant the main difference is cost, since credit card transactions generally attract higher fees than debit ones.
Can a business still add a surcharge for EFTPOS?
From 1 October 2026, no. Until then a business can add a surcharge that recovers its card costs and no more. Following the RBA's 2026 review the card networks are introducing no-surcharge rules for eftpos, Visa, Mastercard and Amex, so from that date card costs have to be built into prices rather than added at the terminal.
What is least-cost routing?
Most debit cards can be processed on either the eftpos network or an international network. Least-cost routing lets the merchant send each tap down the cheaper of the two, which is often eftpos. It only affects debit cards, it makes no difference to the customer, and it is worth checking with your provider whether it is switched on.
How quickly does EFTPOS money reach my account?
It depends on the provider and your bank. Many settle the same day or the next business day, and some fintech providers offer same-day settlement into an account they hold for you. Weekends and public holidays can add a day. If cashflow is tight, settlement speed is worth weighing against the transaction fees.
Can a lender use my EFTPOS records?
Yes. Merchant statements show turnover day by day, which lenders read alongside bank statements when assessing a business. Some finance, such as a merchant cash advance, is sized and repaid directly off card takings. Keeping settlements tidy and consistent with your bank statements makes that assessment quicker.
Related terms
Credit card
A credit card is a form of revolving credit that lets you borrow up to a pre-approved limit for purchases, cash advances or short-term finance.
Read definitionFees
Fees are the explicit charges a provider applies for a financial product or service, separate from interest and covering access, administration or transactions.
Read definitionCash flow
Cash flow is the movement of money into and out of a business over a period; unlike profit, it tracks actual receipts and payments, so it measures liquidity.
Read definitionBank statement
A bank statement is a record from your bank listing every deposit, withdrawal and fee on an account, with the running balance for the period.
Read definitionDirect debit
A direct debit is an authority, given through a Direct Debit Request (DDR), that lets a biller withdraw agreed payments from your nominated bank account, usually for recurring bills.
Read definitionBuy now, pay later (BNPL)
Buy now, pay later (BNPL) is regulated consumer credit where a provider pays the merchant up front and you repay in set instalments, usually interest-free if paid on time.
Read definitionGo deeper
Sources
This article is general information only and is not financial advice.